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Asda equal pay case: Court of Appeal decision

Nicola Ihnatowicz, Employment partner -Trowers & Hamlins LLP

Nicola Ihnatowicz, Employment partner at Trowers & Hamlins LLP commented:

This is the largest ever equal pay claim against a private employer, and confirms that the fact that retail and distribution staff work exclusively at different sites is no barrier to the tribunal ordering an equal value report to be prepared.  But the case is still at an early stage, and no decision has been made on whether the retail staff and distribution staff are doing work of equal value as a matter of law.  It is also not the only equal pay case ongoing against a supermarket.  Early this year Tesco was ordered to disclose information about how much its warehouse staff are paid, in a claim being brought by shop floor workers”

The Supreme Court has upheld the Court of Appeal’s decision that a predominantly female group of supermarket retail employees can compare themselves with a mainly male group of distribution depot employees for the purposes of an equal pay claim in Asda Stores Ltd v Brierley and others.

Over 7,000 equal pay claims were brought against Asda Stores Ltd (Asda) by retail employees who were predominantly women.  They sought to compare themselves with high-paid employees in distribution depots, who were predominantly male.  Although the employment terms in retail and distribution are set by different management processes, all those responsible for setting these terms are answerable to Asda’s Executive Board.

At a preliminary hearing Asda argued that the claims should be struck out on the ground that the retail staff could not compare themselves with the distribution staff their chosen comparators.  Both the Employment Tribunal and the Employment Appeal Tribunal (EAT) held that the retail employees were entitled to compare themselves to distribution employees for the purposes of their equal pay claim.

The Supreme Court agreed with the Court of Appeal holding that even though the two groups worked at completely separate establishments, such that no distribution worker would have done distribution work at a retail site, and no retail worker would have done retail work at a distribution depot, a comparison could be made because the employer observed broadly common terms and conditions for the relevant groups across its sites.  The fact that the Asda Executive Board was ultimately responsible for pay across the two groups also satisfied the “single source” test under EU law for the purposes of Article 157 of the Treaty on the Functioning of the European Union (TFEU), which was a further reason to find that the comparison was valid under domestic law.

The claim, which was brought in 2016, is still at a preliminary stage and will now go back to the Tribunal to be considered.  In order to be successful, the retail staff will have to demonstrate that their roles are of equal value to the distribution staff and, if they are, that there is not a reason other than sex discrimination which means the roles should not be paid equally.

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